IE 11 is not supported. For an optimal experience visit our site on another browser.

Oprah's magic helps small businesses, ready or not

Some companies touched by "The Oprah Winfrey Show"got an instant lift that soon fizzled; others continue to enjoy the Oprah Effect to this day.
Image: Oprah Winfrey
And you've won ... A NEW CAR. Oprah's annual "Favorite Things" episode has helped businesses of all sizes. Sometimes the resulting new orders are tough to handle.George Burns / PR Newswire via Newscom
/ Source: Business Week

When Sam Greenberg got the call in the fall of 2003, he was sitting in his office at the East Texas purveyor of smoked turkeys his father founded during the Great Depression. A producer from "The Oprah Winfrey Show" was on the line to see if Greenberg would give 400 of his hickory-smoked fowl away to a studio audience. As they talked, Greenberg glanced out his window onto the sales floor and saw dumbstruck employees staring at him. One held up a sign that read: "Oprah's on line three."

Winfrey got right to the point. "Can you handle it? Can you get the turkeys out?" Greenberg recalls her asking, eager to make sure the flood of attention wouldn't overwhelm him. Greenberg said he would, knowing full well what an introduction to millions of Oprah's diehard fans could mean for a company with a dozen full-time employees. "We'll be fine," he said. Then Winfrey asked to be transferred to someone who could take her own order; turns out she'd been buying Greenberg's turkeys ever since receiving one as a gift.

Greenberg Smoked Turkey of Tyler, Tex., was about to star on "Oprah's Favorite Things," an annual show that earned its own spoof on "Saturday Night Live" for all the shrieking from the audience when Winfrey showered them with gifts, from LG fridges to Volkswagen Beetles. For makers of the more than 160 products that have appeared on those shows, plus scores more that received even a passing nod on Oprah's website or in her magazine, it's like winning the Lotto.

It was brave of Greenberg to so blithely say he was ready for the Oprah Effect, that brief, bright bump that's become the Holy Grail of businesses everywhere. Despite selling about 150,000 birds a year, the company had no website and didn't accept credit cards. What's more, the show was 12 days away and the turkeys took four days to smoke. Greenberg first alerted existing customers that a surge in demand was coming, thanks to vaguely described media attention, and that they'd be wise to order now. Next, the company boosted production by 10,000 by squeezing more turkeys into its 20 smokehouses and running them 24/7. A makeshift website was built to take orders, though buyers could pay only by check.

Businessweek: Oprah's wide reach

On the big day, Winfrey raved about the turkey for 42 seconds and the company's 20 phone lines lit up. The business normally signed up 5,000 new customers annually. In the two weeks post-Oprah, 22,000 first-timers came calling at an average of $50 per order. The turkeys sold out by Dec. 10, a holiday season record. "To mention my product for 42 seconds and to sell $1 million worth of turkeys, that's a lot of power," says Greenberg. "Her endorsement is worth its weight in gold."

Some companies touched by Oprah got an instant lift that soon fizzled; others continue to enjoy the Oprah Effect to this day. For Greenberg, a link on prolonged the demand, generating 35,000 orders. The company now sells about 200,000 birds a year.

Businessweek: Brand Oprah has some marketing lessons

At Eco-Bags, which makes reusable grocery sacks, sales quadrupled, to $800,000, in the four months after the Ossining, N.Y., company was featured on a 2007 episode dedicated to Earth Day. After the show, it expanded its online store to offer other green items Winfrey endorsed, helping boost sales for a year and a half. The Oprah nod helped the company land a deal to make bags for Estée Lauder. "We had people calling up just saying, 'I want to go green,'" recalls founder Sharon Rowe, who suddenly was able to afford solar panels for her house and her son's college bills. "Oprah made green cool."

The story was different for John and Terri Stephen after their call in January 2001. The show wanted their Weemote, a child-friendly TV controller, for an episode on tech breakthroughs. The device had hit the market only nine months earlier, selling through catalogs and a few specialty stores. The Stephens had three employees, including themselves, and shipped from the garage of their Palmetto Bay, Fla., home. A few weeks later they got their 49 seconds of fame, and "we just stood there screaming," Terri says. "It was like the Super Bowl." Their website traffic surged eightfold, and people told them they'd made it.

Businessweek: Is cable one market Oprah can't conquer?

Not quite. They sold about 5,000 units online in the next three months, up from the couple hundred they normally sold that time of year. In the fall they sold 60,000 units to Target, but by then the attention had passed. "If we had it at retail, it would have given us so much lift we probably would have done quite well for a long, long time," says John. "It was a bit disappointing. You can't tell Oprah to wait."

The bottom line: Landing a spot on "Oprah's Favorite Things" show is every small company's dream. The inevitable sales bump could be difficult to manage.